Heineken's shares slide as first-half results miss forecasts.

By Emma Rumney

LONDON (Reuters) -Shares in Dutch brewer Heineken (AS: HEIN) slid almost 8% on Monday after an expected sports-led boost for beer sales failed to materialize and it took an 874-million-euro ($948 million) impairment charge on its Chinese investment.

The maker of Europe's top-selling larger raised its full-year operating profit forecast but some analysts said that too was not as bullish as they had expected.

It reported a 12.5% rise in operating profit for the first six months of the year, slightly below a 13.2% analyst forecast from a company-compiled consensus. Its first-half revenue and volumes also came in slightly below expectations.

Heineken now expects organic operating profit growth of between 4% and 8% in 2024, compared to its previous guidance of between low and high single-digit growth. This remains below the 8.2% growth analysts currently expect.

Chief Financial Officer Harold van den Broek said the guidance reflected a weak June and July in Europe, where cooler weather impacted Heineken's performance and an expected boost from sporting events did not materialize.

Heineken and other European brewers were expecting to sell more beer this year helped by events such as the 2024 European Football Championship in Germany and the Olympics being held in Paris.

Shares in Heineken's rivals fell in its wake on Monday, with Carlsberg (CSE: CARLb) down 4% and Anheuser-Busch InBev 0.8% lower. They are yet to report half-year results.

Investors had been eager for Heineken to update its guidance since it disappointed the market in February by setting a wide-ranging outlook for profit growth, drawing criticism for being overly cautious.

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BetMGM warns full-year loss will be bigger than previously expected.

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(Reuters) -U.S. sports betting platform BetMGM said on Monday that its losses for the year would be bigger than previously expected as it invests heavily in marketing amid intense competition in the industry.

The joint venture between MGM Resorts (NYSE: MGM) and Entain reported a core loss of $123 million for the first half of the year, and said it expects losses in the second half to be similar to those levels.

Analysts at JP Morgan said the second-half forecast implied an annual core loss of about $250 million, compared with a JPM estimate of about $93 million in losses.

Shares in Entain dropped nearly 10% to their lowest since April 2020, when COVID lockdowns hit. MGM was down 1% in U.S. premarket trading.

BetMGM made about a $67 million loss for 2023 although it said it turned a profit for the second half of 2023.

Founded in 2018, BetMGM has been stepping up its investments and expanding its presence in North America as it faces tough competition in the market with bigger players like Flutter's Fanduel and DraftKings.

BetMGM CEO Adam Greenblatt said: "2024 is a year of investment, focusing on improving our customer experience and stepping up our level of investment in players."

Rival Flutter in May had reported a first quarter core profit of $26 million in the United States. Fanduel increased its share of the sports betting market to 47% in the first three months of 2024.

BetMGM said it had a 13% market share in the U.S. and Ontario, Canada across Sports Betting, and iGaming as of the end of the second quarter, which was down by a percentage point from the first quarter.

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BTIG: Market correction has more room to run.

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Despite last week's pullback in the S&P 500 (SPX), the underlying indicators did not align with durable lows, as 60% of the benchmark index’s components remained above their 20-day moving average (DMA).

According to BTIG analysts, that inconsistency is partly due to the rotational nature of the market, with tech weakness being offset by cyclical strength.

"Regardless, we still expect a reading closer to 15% before this correction has run its course," they noted.

"We can probably drift a bit higher on SPX towards its gap at 5550, before moving lower to fill a gap at 5375."

Internally, market rotations have been intense, BTIG added.

The 12-day rate-of-change for the Russell 2000 versus the NASDAQ 100 is over 20%, ranking as the fifth largest such move since 1985, surpassed only by a few days in December 2000 and January 2, 2001.

Analysts believe a “reversal of that reversion” is likely, with semiconductors (SMH) oversold into support, while homebuilders (ITB) are overbought and rallying on anticipated rate cuts, despite higher rates being part of their bull thesis over the past couple of years.

“Correlation between ITB and SMH has gone from +.9 for much of the last two years to -.4. SMH vs. ITB is oversold into support,” analysts pointed out. While this may not be the end of correction for semis, they “should attempt” to bounce back from here.

Moreover, BTIG noted there are breakouts among defensive stocks, with sectors such as staples, utilities, REITs, and healthcare all looking strong.

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